Netflix Execs Vow to Keep Warner Bros. Movies in Theaters, Hint at HBO Bundle

Netflix’s bid for Warner Bros. Discovery (WBD) has ignited antitrust alarms, job-loss fears, and doomsday warnings for cinema. But the streamer’s co-CEOs insist the megadeal will be a win for consumers and Hollywood alike.

“We are very confident that regulators should and will approve it,” said Netflix co-CEO Greg Peters at the UBS Global Media and Communications Conference on Monday. “At the end of the day, it’s pro-consumer, delivers more value to those folks. It’s pro-creator, we’re going to increase content spend and deliver more.”

Peters also pushed back on antitrust concerns, citing data from research firm Nielsen that found Netflix ranked sixth for share of TV time in the US, behind YouTube, Walt Disney, NBCUniversal, Fox, and Paramount. If HBO’s content came to Netflix, it would cause the streamer’s share to only jump from 8% of view hours to 9%, he claimed. (Still, an August report from Nielsen found that Netflix ranked third as the largest TV media distributor.)

On fears about the death of cinema, co-CEO Ted Sarandos also noted: “We’re deeply committed to releasing [Warner Bros.] movies exactly the way they would release those movies today.”

The streaming giant has generally ducked big releases in theaters for its own movies. But Sarandos said the WBD acquisition means Netflix will be formally entering the theatrical business, meaning it’ll seek to maintain the big box office earnings of traditional movie releases. 

“We didn’t buy this company to destroy that value,” he added. Netflix plans on doing the same with Warner Bros. television content, which Sarandos described as a “really healthy business.”

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“We want HBO to double-down on the things that people have loved about it for 50 years,” he said. “Their assets work better in our business model, and our business works better with these assets.”

(Photo by Mario Tama/Getty Images)

Over the weekend, President Trump suggested the deal could face an antitrust “problem.” However, Sarandos said he’s spoken with Trump “many times since the election about the different challenges facing the entertainment industry” adding, “What the president has been interested in, in this deal, has been to what extent does it protect and create jobs in America?”

Sarandos also argued that Netflix plans on investing in Warner Bros to create more jobs, alleging that Paramount-Skydance, which launched a hostile takeover bid for WBD this morning, would likely focus on cutting costs and forcing layoffs. 

Still, consumers can expect changes and possible price hikes if Netflix can absorb WBD. During the talk, the company’s executives hinted the HBO Max content will be offered to Netflix subscribers as a paid add-on or as a new tier in the Netflix catalog of plans.  

“It speaks prestige TV,” Peters said of the HBO brand. “We want to double-down on that concept. And then we think that gives us an additional lever, additional tool, to essentially think about how we compose plans and offerings for different consumers to give them the right kind of entertainment they want, at the right price point.

“And we think that we are in the business of doing that kind of optimization,” he added. “We’ve done that with our ads plan as an example. We had to think about how do you compose a set of offerings that maximize value for the business while keeping consumers happy with different offerings.”

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